Oamaru wool workers prospects 'limited'

Summit Wool Spinners' Oamaru plant - the second biggest employer in the town - is to close. File photo / Darryl May

It remains to be seen whether workers who are set to lose their jobs when the Summit Wool Spinners' Oamaru plant closes will be able to pick up work elsewhere in New Zealand, the Otago Chamber of Commerce says.

Japan's Sumitomo Corp confirmed yesterday that it has sold Summit Wool Spinners plant to Australia's Godfrey Hirst, leading to the closure of the Oamaru plant.

Summit is New Zealand's largest independent spinner, supplying carpet and rug yarn for the domestic and international markets.

Members of the EPMU and FIRST Union were told of the decision at a site meeting yesterday afternoon.

EPMU organiser John Gardner said Summit - Oamaru's second biggest employer - had been hit hard by the high New Zealand dollar.

The closure would result in the redundancy of 192 workers.

Otago Chamber of Commerce chief executive John Christie told Radio New Zealand it was unwelcome news and the number of other jobs available in Oamaru would be "limited".

"I know a number of the businesses there which will look to do whatever they can to ensure there's ongoing employment for those people.

"But the reality is not everyone is going to get a job, and some of them will possibly have to leave the district to get a job," he said.

The workers would have specific skillsets and not every town had a spinning plant.

"Whether they can pick up work elsewhere in New Zealand, whether there are opportunities to do that with the new ownership, remains to be scene," Christie said.

Greens co-leader Metiria Turei said the jobs were "sacrificed because of the National Government's devotion to a failed monetary policy and its unwillingness to change with the times".

"This week, manufacturers came to the Parliamentary Inquiry into Manufacturing and warned us that more businesses would close and more jobs would be lost unless the Government gets the dollar down to a fair level quickly."

Labour's finance spokesman David Parker said the current owners and workers of Summit were more victims of the high dollar, which was crippling exporters and costing jobs.

"This cannot go on. Our manufacturing sector outside primary industries is being hollowed out and the dollar is to blame. But National refuses to consider any changes that might lower the exchange rate," he said.

However, Economic Development Minister Stephen Joyce said the opposition parties were selling a "fool's gold solution" by suggesting policy could be tailored to the manufacturing sector.

Joyce told TV3`s Firstline that New Zealand had only one dollar - and it was a dollar for farmers, consumers and families as well as manufacturers.

Sumitomo said the decision to sell was driven by a number of factors affecting trading results, including an unfavourable exchange rate and less local demand for wool carpets.

International demand for woollen carpet yarn had also been affected by the global financial crisis, Summit's managing director Harry Ogawa said.

From Sumitomo's perspective, Summit was becoming isolated from the parent's global textile business, he said.

The acquisition is expected to become effective from the end of this month.

The plant was sold to the Godfrey Hirst subsidiary Canterbury Spinners, which operates plants in Lower Hutt and Dannevirke.